The third year of a presidential cycle tends to be a very strong time for the stock market — so if history is any indicator, the 2019 bounce back to record highs with Donald Trump in the White House could very well be here to stay.
Terranova said the first two years for presidents tend to underperform and stocks get moving in the second half of their four-year terms. Since 1949, the average annual return for the index in the third year of a presidential cycle is 16%, according to Schaeffer's Investment Research. The S&P 500 on Tuesday saw its first record closing high since September 2018, before the market stumbled late last year. As of Tuesday's close, the index was up 17% year-to-date.
“...trump had a strong first two years.” The point at 1/22 is the first trading day after trumps budget took effect. The stock market stalled. Before that it was Barack’s. Notice how not stalled it was? Please tell me how well trump’s StockMarket is doing again.
And then there is the China effect. What about the belief that they are the biggest factor in world markets now. The biggest China ETF, FXI peaked 12 days ago after a 15 % surge since Christmas Eve, and is at this moment taking out the 12 day low in spite of US markets. Why?
I wonder how many people realize we are basically back even to where we were at the end of last year. How many regular investors bought at those lows to see that stock surge.